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Delegated Management Contract in New Orleans Opens New Chapter For Transit in the U.S.

New Orleans, long known for its fine jazz and easy-going lifestyle, made an historic move on July 1, 2009 when the Board of Commissioners of the New Orleans Regional Transit Authority (RTA) unanimously approved terms on a delegated management contract with Veolia Transportation. This historic agreement is based on an ambitious, phased plan to improve public transportation and mobility in New Orleans over the next 10 years, as a cornerstone of the citys continuing renewal following Hurricane Katrina.

Under this “Delegated Management” contract, Veolia Transportation is responsible for performing all activities of the transit authority below the Board level. This means that Veolia is responsible for all aspects of the public transportation system in New Orleans, including operations, safety, maintenance, customer care, routes and schedules, capital planning, budgeting, employee salaries & benefits, human resources, marketing, ridership growth, grant administration, as well as all the other typical functions of a transit authority.

Veolia reports to the Board of Commissioners of the New Orleans RTA, which sets the direction for the RTA and is responsible for establishing RTA policies including fares, service and operations, as well as approval of each years annual transportation development plan and budget.

New Orleans is the first city in the United States where the “delegated management” model is being fully deployed. This contractual model is widely used in Europe, but is not well known in the United Sates. The agreement in New Orleans is significant because it is the first time that a private sector company has assumed all of the functions and operations of a transit authority, and also all of the commercial risks involved in managing, operating and maintaining a city transit system, including legal, financial, insurance/safety-related and operational risks. Simply put, it means that the RTA Board of Commissioners fully delegated the management and operation of the transit authority to Veolia Transportation, which has responsibility for all the transit authority functions and operations as described above, reporting to and under the oversight of the RTA Board of Commissioners which oversees its contract performance, policies and budgets.

This model is widely used in Europe because it enables cities to benefit from private-sector expertise and efficiencies, under direct oversight from a public sector board.

Because of the large number and extensive scope of contracts managed worldwide by Veolia Transport, the company can draw from national and international technical expertise, systems, processes and talent to improve and expand the RTA transit system more quickly and efficiently.

A Shared Vision for the Future

Veolia Transportation, Mayor Mitch Landrieu, and the RTA Board have a multi-faceted vision for improving mobility in New Orleans during our contract term, including enhancing the performance of the transit system, expanding streetcar service, collaborating with area transit authorities to improve inter-modality across the region by synchronizing bus timetables with those of neighboring parishes, improving customer signage, shelters and the entire customer experience, implementing a BRT, and much more.

Major Accomplishments in Veolia's Tenure

The fleet is now one of the newest in the U.S., and a $45 million TIGER grant was secured to expand the streetcar line into a major downtown corridor, which is generating a tremendous amount of new development in the area. Major improvements have been made in safety and on-time performance, maintenance and vehicle reliability, signage and passenger information,and the Agencys bond rating has been substantially approved. A new complete branding system has been developed by Veolia for the RTA and a state-of-the-art passenger website will be launched this summer. An extensive program is underway to replace the cross-ties on the St Charles and Riverfront lines, using recycled materials, which will have a much longer life. A major program to make all aspects of operations more sustainable has also been put into place.